Recap: HRN Construction Industry Forum

The following is a summary of presentations made at the HR Nicholls Society “Cleaning up Corruption in the Construction Industry” Forum, held in Melbourne on Monday 25 August 2014.

Address by the Hon Robert Clark MLA

The Victorian Minister for Industrial Relations, Attorney-General and Minister for Finance, the Hon Robert Clark MLA, told the HR Nicholls Society at a forum on ending union thuggery and cleaning up corruption in the construction industry that:

The rule of law and competitive processes were the key underpinnings of the Victorian Coalition government’s industrial relations policy.

Following the election of the government in November 2010, the Coalition sought to use its industrial relations policy as a way to fill the void created by the gutting and subsequent abolition of the Australian Building and Construction Commission (ABCC) by Julia Gillard, Minister for Workplace Relations in the Rudd government.

The key manifestation of this objective was that the government decided it would use the State’s position as a large purchaser of construction projects to ensure the rule of law being upheld and competitive processes were pre-conditions for all government construction projects.

The policy tool used to fill the void created by Rudd and Gillard was the establishment of the Victorian Code of Practice for the Building and Construction Industry and the Construction Code Compliance Unit to oversee its operation.

Despite efforts by the Minister for Workplace Relations in the Gillard government and now Leader of the Labor Party, Bill Shorten, to impede the operation of the Victorian code with Commonwealth changes, with little notice, the Victorian code has been successfully operating since its introduction.

An important element of the code’s operation is that it now requires tenderers or contractors to clearly set out how critical practices, for instance freedom of association, will be upheld.  An increasingly problematic issue on construction sites in the period following the abolition of the ABCC has been the coercion of sub-contractors by union officials and this element of the code has directly addressed that.

As part of the government’s determination to tackle criminal organisations operating within building and construction sites the Criminal Organisations Control Act was legislated.

In the wake of the CFMEU’s actions at the Myer Emporium site, for which penalties of over $1million have now been applied, the Coalition’s “move on” laws form an important part of addressing militant unionism, tackling unlawful blockades.

On 29 November 2014 there will be a Victorian State Election and there is a stark difference between the two major parties on industrial relations policy. The Coalition is supporting the Commonwealth’s Royal Commission, it is upholding the rule of law, putting a stop to restrictive practices and cleaning up corruption in the building and construction industry. The Labor Party by contrast is committed to scrapping the “move on” laws and guidelines for the building and construction industry and will declare open season for John Setka and the CFMEU.

Address by Lee Kuzmanovic

Ms Kuzmanovic of Versatile Precast Industries Pty Ltd addressed a forum of the HR Nicholls Society on cleaning up corruption in the construction industry regarding her family’s experience in the sector over three decades. Ms Kuzmanovic said:

That her firm was the first in Melbourne to own a fifty tonne mobile crane. The first to successfully offer the City of Frankston an alternative tender for twin bridges over rail, saving the council more than $2million. The first to erect precast ‘T’ beams over rail and that during this period it was also the first time her firm began paying the Crane Union, FEDFA, to keep harmony on their sites.

In Mid-1999 she received her first call from the Secretary of the CFMEU, who demanded that she sign an EBA with the union and laughs when she tells him that she already has an agreement with the Australian Workers Union (AWU). He then advised her that the piling team on the site of the Hallam Bypass project was “locked in” the lunch room and twenty of her own workers were in the sheds. She had no contact with her site foreman and was ‘invited’ to visit the CFMEU offices on Swanston Street to sign an agreement with the union.

As Versatile had a government contact that did not consider industrial relations as a matter for the government and as Versatile faced liquidated damages if the project was delivered late, Ms Kuzmanovic had little choice but to sign her first three year EBA with the CFMEU.

It was in 2008 that for the first time she attached a non-union EBA and compliance letter to Versatile’s  government tenders. Following this a period of extraordinary bullying and intimidation began. The CFMEU attempted to force Ms Kuzmanovic’s firm not only to sign a ten centimetre thick anti-competitive EBA with a 36 hour working week but to install shop stewards in their precast factories.

CFMEU organisers routinely walked into lunchrooms without invitation or authority attempting to force employees to sign up or pay for memberships. These same organisers would then walk into Ms Kuzmanovic’s office and demand she write a cheque covering all those employeeswho could not or would not pay.

One worker was even grabbed by his clothes and rammed up against a concrete wall for refusing to join as a member of the CFMEU. Ms Kuzmanovic’s receptionist was bullied, intimidated and yelled at and engineers who were frightened at the need for police to attend premises to remove trespassing organisers resigned their positions.

Ms Kumanovic’s son was even told by a CFMEU organiser that they were “going to get” his father.

It was not only the intimidation of union organisers entering premises uninvited that traumatised Ms Kuzmanovic’s employees but the continuous visits of Work Safe inspectors called in by the CFMEU.

It took a great deal of time and expense which caused losses in the hundreds of thousands of dollars, but Ms Kuzmanovic took on Work Safe and had all matters against them withdrawn.

The lesson Ms Kuzmanovic learned was that militant unions only have power if you allow them to have it. It is critical to stand firm against the bullying and intimidation of unions like the CFMEU.

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